In the 2- factor,2- good Heckscher- Ohlin model,the two countries differ in
A)labor productivities.
B)relative abundance of factors of production.
C)tastes and preferences.
D)military capabilities.
E)the size of their economies.

Question

Quizplus · Accepted Answer

The Heckscher-Ohlin model assumes that countries differ in their relative abundance of factors of production, which leads to differences in comparative advantage and trade patterns.

In the 2- Factor,2- Good Heckscher- Ohlin Model,the Two Countries